Stadiums v. Schools: your voice needed at City Hall
March 10, 2009 7:52 am
Update: Council approved the measure with an amendment introduced by Dan Saltzman removing the $15 million from a new urban renewal district around PGE Park. Nick Fish and Amanda Fritz voted no on the modified deal. Kudos to Saltzman for taking the county and school district into account, and for Fish and Fritz for opposing the deal outright. If the city doesn’t come up with the $15 million by September, the deal is off.
Original post:
The Portland City Council votes tomorrow today on a deal that would commit something like $89 million of public funds to build one stadium and renovate another for Merritt Paulson, the millionaire son of Bush Treasury Secretary Hank Paulson. The source of the funds would be Tax Increment Financing from a new urban renewal district.
Multnomah County Commissioner Jeff Cogen and state representative Nick Kahl explain how this takes money from our schools and social services, and City Commissioner Amanda Fritz explains how this type of deal is at odds with her vision of spending scarce public funds in the neighborhoods where people live (among other things).
Amanda is the only City Commissioner who appears likely to oppose the deal at this time. Randy Leonard and Sam Adams are definite yes votes; Dan Saltzman and Nick Fish may be on the fence.
This is on the agenda for 9:30 am Wednesday, March 11. If you are unable to attend, please call or send e-mail to Fish (503-823-3589, nick@ci.portland.or.us) and Saltzman (503-823-4151, dsaltzman@ci.portland.or.us) in particular, urging them to oppose this welfare-for-the-rich deal.
Update: Multnomah County chair Ted Wheeler will testify against the stadium deal tomorrow, as will PPS school board member Trudy Sargent (see below).
Steve Rawley published PPS Equity from 2008 to 2010, when he moved his family out of the district.
filed under: City, Tax policy
March 10th, 2009 at 11:19 am
If the URD doesn’t exist yet, and since it’s increment financed–how does it cut PPS out of anything? The base continues to fund the county as usual; only the ADDITIONAL revenue from increased value would be used. Without the URD there’s much less chance of increased value.
March 10th, 2009 at 11:40 am
Good job and good luck defeating this scam.
March 10th, 2009 at 11:53 am
This is the usual canard of those defending TIF: the value wouldn’t increase without the improvements, so we wouldn’t have that revenue anyway.
Of course, this depends on the area under consideration actually being “blighted” (as required by law) and thus at risk of property value deflation or stagnation. That’s far from the case in the area surrounding PGE Park (Multnomah Athletic Club, The Civic condos, etc.).
The properties in this area are going to appreciate in value with or without another costly renovation to the stadium, but now the county and school district won’t get any of the increased tax revenue from it, for the life of the URA.
This deal directly takes money from schools and social services and uses it to subsidize a millionaire’s dream of being a big league (in name only) sports team owner.
There’s so much wrong with this deal, I barely know where to start. But pay attention to where the money comes from and where it goes. That alone fails the sniff test.
Thank goodness for leaders like Fritz, Cogen and Kahl, who have the courage to speak out against business as usual in Portland.
March 10th, 2009 at 12:18 pm
The definition of “blighted” is broad and vague, and encompasses things like “prior poor planning.” And in any case, one can easily argue that the area would see significantly more value WITH the development, than without.
County services are needed, but $15mil isn’t going to change a thing–and the rewards are huge. Just for starters, 600 immediate construction jobs. The amount of direct stimulus being realized for the cost outlay is a tremendous bargain–just $25,000 per job.
And it’s curious that no one’s mentioning Paulson’s committment to the City of Portland for what appears to be $3mil in direct recreational funding, 30% of which would go to fields that the City desperately needs.
March 10th, 2009 at 12:27 pm
Sorry, Joe, sounds like “magical thinking.”
The big winner is Paulson. No way is that part of town blighted in any way, and no way is another renovation to PGE Park and a handful of soccer games a year going to contribute to increasing property values.
Anyway, the priorities are all screwed up. But that’s not going to stop the rump of the Goldschmidt gang from sticking it to the little guy to the benefit of some rich bastard… yet again.
Want stimulus? Build something useful to society. Public investment in sports stadiums never pans out the way the proponents claim it will.
March 10th, 2009 at 12:44 pm
“Want stimulus? Build something useful to society. Public investment in sports stadiums never pans out the way the proponents claim it will.”
That’s based on studies involving WAY more public investment, and MUCH bigger facilities. The proper measure of stimulus is whether the result will be enduring. The City will own two new facilities, with almost no risk. The conclusion was not that there is NO economic benefit to public stadia; rather, that the typical investment and risk are not adequately borne out by the returns. When returns come without risk, that changes the equation entirely.
The priority now should be JOBS, immediately–which makes this pretty much the best thing going to spend money on right now.
March 10th, 2009 at 1:09 pm
Many would argue that we could be creating jobs building health, education and recreation infrastructure in truly blighted, under-served parts of Portland, and that we’d have a much more important things to show for our investment in twenty years.
But we’ll never see an army of man-children mobbing city hall with chain saws demanding it.
How many stadiums did FDR build?
This speaks volumes about our civic character.
March 10th, 2009 at 2:41 pm
“Many would argue that we could be creating jobs building health, education and recreation infrastructure in truly blighted, under-served parts of Portland, and that we’d have a much more important things to show for our investment in twenty years.”
Putting aside the obvious fact that we already are–why can’t we do so now? If they’re blighted, start up a URD.
March 10th, 2009 at 3:06 pm
You know, I’m finding it hard to believe that we’re even seriously discussing this nonsense. Ok, I’m not a financial genius, but I don’t believe for a nanosecond that this is either a worthy use of urban renewal as a concept or a reasonable deal for the city as a whole.
If you look at the long and dismal history of public funding of sports teams, you’ll have a hard time finding ANY deal that actually delivered on all the public benefits that were promised by the team owners. (See, for example, a Brookings study from 1997, Sports, Jobs, and Taxes: Are Stadiums Worth the Cost? http://www.brookings.edu/artic....._noll.aspx) The real bottom line is that the deal for cities almost invariably stinks at the end of it. These little boondoggles are just another example of the shameless “investment strategies” that have brought this country to its knees and are predicated on the socialization of costs and the privatization of profits.
Moreover, I find it vaguely delusional that we are talking about this now. Who’s going to buy these bonds worth $85 million? Have you read the papers lately? Ok, let’s assume for the sake of argument that you can find buyers. Has anybody considered the opportunity costs? Is there NOTHING more socially responsible that we could use some bond money for? But ok, let’s assume that this is a swell idea and the stadium gets redone – again. Who’s going to buy tickets? The projections on ticket sales embedded in the longer term “planning” for this team seem not to have factored in the economic meltdown and the ballooning unemployment rate. Can we get real here?
But more to the point, I am appalled that the public sector, and apparently the public, think that throwing boatloads of public money at sports is a fine idea, but heaven forbid we should give more than the barest minimum to education or any other actual public good. Remember the $300 M bond for the U of O football extravaganza? Anybody out there think we could convince anyone to float a $300 M bond to fund actual classrooms? I didn’t think so.
People say all kinds of things about what they “value.” But if you really want to see what they value look at the budget.
Bread and circuses.
March 10th, 2009 at 4:20 pm
Thanks so much for this action alert, Steve.
PPS staff and board members have been contacting City Council with our concerns and will be at the council meeting tomorrow – Trudy Sargent will testifying on our behalf.
A quick email or voicemail tonight from citizens would be most appreciated!
March 11th, 2009 at 8:24 am
Rita, it’s not $85mil in bonds. $31mil is from ticket surcharges and the tourism fund, a little over $23mil will be secured by Paulson, and about $33mil will come from URDs, one of which has a $26mil reported surplus.
The studies are correct–but I’ll repeat: look at the deals discussed in those cases. Bigger public outlays, higher revenues required to meet obligations, little to no privatization of risk. The deal Paulson agreed to is much, much tighter. The task force–not of politicians, but citizens–laid out a stiff set of conditions, which they report have largely been met.
I am as skeptical as anyone about the general wisdom of such projects–but you have to analyze them case by case. This is an unusually sweet deal for the city, actually. The risk is extremely low.
And I just noticed the margins of the blog are notebook paper lines! Nice touch… 😉
March 11th, 2009 at 3:07 pm
You’re right, TJ. It is a sweet and low risk deal for the city. But…
If the property tax freeze in the proposed Urban Renewal District deprives the county and PPS of much needed tax revenue, then the deal, at least from that perspective, doesn’t look quite as sweet.
March 11th, 2009 at 5:20 pm
I’d rather use the funds to create living wage jobs. How about some permanent teaching, nursing, and administrative jobs by building some new schools, libraries and health clinics in the county?